Cannabis producer Canopy Growth to refile financial statements

Canadian cannabis producer Canopy Growth Corp. plans to refile some of its financial statements for the fiscal year ended March 31, 2022.

The Smiths Falls, Ontario, company is making the move after identifying “material misstatements” related to sales of its BioSteel business unit that were incorrectly accounted for.

Canopy is among a number of cannabis companies that have restated financial results in recent years.

Canopy said it is “is unable to quantify the impact” of the pending corrections because the review is ongoing, according to the company’s recent disclosure with the U.S. Securities and Exchange Commission.

The company said it initiated the internal review, under the oversight of the Audit Committee, after identifying “certain trends” in the booking of BioSteel sales while preparing its financial statements for the fiscal year ended March 31, 2023.

Canopy booked 44.6 million Canadian dollars ($33 million) in BioSteel sales in the 2022 financial year, representing 8.6% of Canopy’s net sales that year.

BioSteel is a sports nutrition and hydration brand.

Canopy said the following reports should no longer be relied upon because of the material misstatements:

• Audited financial statements for the fiscal year ended March 31, 2022.
• Unaudited financial statements for the quarterly period ended June 30, 2022.
• Unaudited financial statements for the quarterly period ended Sept. 30, 2022.
• Unaudited financial statements for the quarterly period ended Dec. 31, 2022.

“The company has determined that it is appropriate to correct the misstatements by restating the Prior Financial Statements and plans to file the Restated Financial Statements as soon as practicable,” according to the SEC disclosure.

Canopy said it is still working on the review and cannot predict when the assessment will be completed.

The company also said it does not expect to file its annual report for the fiscal year ended March 31, 2023, until the restated financial statements are completed.

Canopy shares trade as WEED on the Toronto Stock Exchange and CGC on the Nasdaq.

Source: https://mjbizdaily.com/cannabis-producer-canopy-growth-to-refile-financial-statements/